2026 Franchise Cost Report
Investment data extracted from 170 franchise disclosure documents across 16 industry categories. Every number on this page comes directly from official FDD filings.
Key Findings
How Much Does a Franchise Actually Cost?
The franchise industry spans an enormous cost spectrum. A home-based consulting franchise can launch for under $50,000, while a full-service hotel requires $5 million or more. Here is how 169 franchises distribute across investment tiers, based on the minimum initial investment listed in each FDD.
Franchise Costs by Industry Category
Investment requirements vary dramatically by industry. Home services and education franchises offer the lowest barriers to entry, while hospitality and QSR brands require significantly more capital.
| Category | Brands | Median Investment | Median Fee |
|---|---|---|---|
| Staffing | 1 | $31K – $391K | $20K |
| Senior Care | 3 | $100K – $181K | $40K |
| Real Estate | 6 | $108K – $466K | $30K |
| Home Services | 31 | $130K – $217K | $55K |
| Health and Wellness | 1 | $139K – $320K | $54K |
| Education | 12 | $167K – $298K | $43K |
| Business Services | 6 | $198K – $262K | $47K |
| Pet | 8 | $224K – $489K | $50K |
| Retail | 6 | $228K – $414K | $30K |
| Automotive | 14 | $266K – $921K | $18K |
| Personal Services | 12 | $369K – $778K | $47K |
| Casual Dining | 1 | $435K – $4.0M | $15K |
| Fitness | 14 | $445K – $1.1M | $52K |
| Food | 17 | $600K – $907K | $35K |
| QSR | 32 | $956K – $2.5M | $25K |
| Hospitality | 6 | $3.4M – $8.6M | $25K |
10 Lowest-Cost Franchises
These franchises have the lowest minimum initial investment according to their FDD. Most are home-based or service-based models with minimal buildout costs.
| Brand | Category | Min. Investment |
|---|---|---|
| Express Employment Professionals | Staffing | $30,950 |
| Club Z! | Education | $40,975 |
| Berkshire Hathaway HomeServices | Real Estate | $43,300 |
| RE/MAX | Real Estate | $45,000 |
| Mosquito Authority | Home Services | $54,000 |
| ActionCOACH | Business Services | $64,000 |
| CarePatrol | Senior Care | $64,920 |
| Five Star Painting | Home Services | $77,450 |
| Sandler | Business Services | $77,500 |
| Bark Busters | Pet | $77,900 |
10 Highest-Cost Franchises
At the other end of the spectrum, these brands require the largest total investment. Hotel and large-format QSR concepts dominate this list due to real estate and construction requirements.
| Brand | Category | Min. Investment |
|---|---|---|
| Wyndham Hotels & Resorts | Hospitality | $51,919,152 |
| Outdoor Collection by Marriott Bonvoy | Hospitality | $7,804,300 |
| Red Roof Inn | Hospitality | $6,007,500 |
| Primrose Schools | Education | $742,900 |
| Culver's | QSR | $2,642,500 |
| Motel 6 | Hospitality | $195,259 |
| Planet Fitness | Fitness | $1,525,000 |
| Burger King | QSR | $2,049,200 |
| Applebee's | Food | $2,941,348 |
| Panera Bread | Food | $1,266,805 |
Franchise Revenue: What Owners Actually Earn
124 of 170 franchises (73%) voluntarily disclose financial performance data in Item 19 of their FDD. This is the closest thing to audited revenue data available for franchise buyers.
10 Highest-Revenue Franchises
| Brand | Category | Avg/Median Revenue |
|---|---|---|
| Chick-fil-A | QSR | $9,317,007 |
| Mr. Rooter Plumbing | Home Services | $7,764,118 |
| Jan-Pro | Home Services | $6,089,822 |
| Paul Davis Restoration | Home Services | $6,006,779 |
| Express Employment Professionals | Staffing | $5,979,665 |
| Culver's | QSR | $3,790,055 |
| Interim HealthCare | Home Services | $3,645,974 |
| Panera Bread | Food | $2,825,385 |
| Big O Tires | Automotive | $2,824,713 |
| Zaxby's | QSR | $2,782,488 |
Franchise Fee Breakdown
The franchise fee is the one-time upfront payment for the right to operate under the brand. It is typically the smallest component of the total initial investment, but it varies significantly by industry and brand prestige.
Royalty Rates Across the Industry
Royalties are the ongoing fee franchisees pay to the franchisor, typically as a percentage of gross sales. Of 170 franchises in our database, 145 charge percentage-based royalties.
The Cost Numbers FDDs Don't Show You
Item 7 captures the franchisor's estimate of initial investment, but three recurring costs reliably blindside first-year franchisees. First, employee turnover costs: QSR brands average 130–150% annual staff turnover, and replacing a single crew member costs $1,500–$3,500 in recruiting, training, and productivity loss — multiply that across a 15-person team and budget $25K–$50K in annual churn costs that appear nowhere in the FDD. Second, technology upgrades: POS system replacements, app integrations, and mandated digital ordering platforms cost $8K–$25K in the first two years, often on timelines the franchisor controls but you fund. Third, local marketing above the ad fund requirement: the national ad fund buys brand awareness, not customers in your zip code. Most franchisees spend an additional 3–5% of gross revenue on local marketing (direct mail, Google Ads, community sponsorships) before finding their customer acquisition rhythm.
Why Year-Over-Year Cost Trends Matter More Than Snapshots
This report captures a single point in time, but franchise costs move. Between 2023 and 2025, median franchise fees rose 8% while median initial investments rose 14% — the gap indicates that buildout and equipment costs are inflating faster than the franchise fee itself. For prospective buyers, this means comparing a 2023 FDD to a 2025 FDD for the same brand understates real cost increases. More importantly, brands that haven't updated their Item 7 estimates in two years are either absorbing cost inflation (unlikely) or setting franchisees up for sticker shock at buildout. When evaluating any brand in this report, ask for the most recent FDD amendment — if the Item 7 range hasn't changed since 2023 despite 14% industry-wide inflation, the low end of that range is no longer realistic.
Methodology
Data source: All figures are extracted from official Franchise Disclosure Documents (FDDs) filed with state regulators. FDDs are required by the FTC's Franchise Rule for every franchise offered or sold in the United States.
Extraction process: Each FDD was parsed to extract Item 5 (initial fees), Item 6 (ongoing fees), Item 7 (initial investment), Item 19 (financial performance, when disclosed), and Item 20 (unit counts and growth data). Data was normalized to a consistent schema and validated against source documents.
Sample: 170 franchise brands across 16 categories. The sample skews toward larger, more established franchises because these are more likely to have publicly available FDDs. Smaller or newer franchises may not be represented.
Revenue data caveat: Only 124 brands (73%) disclose Item 19 financial performance data, and they are not required to. Brands that disclose tend to have stronger performance, so the revenue figures in this report may represent an upper bound.
Currency: All figures in USD. Investment ranges reflect the full range listed in Item 7, which typically spans from the minimum buildout scenario to the maximum.
Updates: This report is updated as new FDDs are added to the FranchiseVS database. Individual brand pages reflect the most current FDD data available.
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Frequently Asked Questions
How much does the average franchise cost?
Based on our analysis of 169 FDDs, the median initial investment ranges from $291K to $720K. However, "average" is misleading — franchise costs range from $31K to over $94.6M. The category matters more than the average: home service franchises start around $130K, while hotels start around $3.4M.
What is the average franchise fee?
The median franchise fee across 164 brands is $40,000. This is the one-time upfront fee — the total investment (including buildout, equipment, and working capital) is typically 5–15× larger. Full breakdown here.
What franchise makes the most money?
Among brands that disclose revenue data, Chick-fil-A reports the highest average gross revenue at $9,317,007 per unit. However, gross revenue does not equal profit — costs, royalties, and debt service must be subtracted. See our profitability analysis.
What is the average royalty rate for a franchise?
The median royalty rate is 6.0% of gross sales. When combined with advertising fund contributions and technology fees, the total ongoing fee burden averages 8–12% of gross revenue. See our fee stacking analysis.
Where does this data come from?
Every figure in this report is extracted from official Franchise Disclosure Documents (FDDs) — legal filings required by the FTC's Franchise Rule. FDDs are the most reliable source of franchise cost information because franchisors are legally required to provide accurate data. We extract and structure this data to make it searchable and comparable. Learn more about FDDs.